PARIS – A dispute between the French government and the main shareholders of Airbus parent EADS is holding up a decision on the A350 jet’s launch, two people close to major EADS shareholders said Friday.
The board of European Aeronautic Defence and Space Co. called off a meeting that had been scheduled to discuss the A350 launch – badly needed to compete with Boeing Co. – on Friday because the French government could not agree with Lagardere SCA and DaimlerChrysler AG over how to finance the program, the two people said.
The people, who spoke on condition of anonymity because the discussions were confidential, said another board meeting had been scheduled for next week.
EADS and DaimlerChrysler declined to comment. Attempts to reach spokespeople for Lagardere and French Finance Minister Thierry Breton were unsuccessful.
The dispute comes as DaimlerChrysler is seeking to reduce its 22.5 percent stake in EADS. Paris-based Lagardere pared its holding earlier this year and now owns 7.5 percent of the European defense group.
EADS announced last month that the double-decker A380 would be delayed by another year. The overall two-year setback, blamed on wiring problems, has angered Airbus customers and wiped $6.3 billion off forecast profit. The financial squeeze, compounded by a weak dollar, comes just as Airbus is seeking to raise roughly $10 billion to develop the A350.
Airbus has steadily lost business to Boeing in the market for midsize planes and needs a new plane to compete with its rival’s 777 and long-range, fuel-efficient 787 Dreamliner – due to enter service in 2008. Top Airbus salesman John Leahy said this week that the European aircraft maker’s market share by value had slipped to about 36 percent this year, from 45 percent in 2005 and 54 percent in 2006.
Initially planned as an improved version of its existing A330 jet, the A350 design has been repeatedly revamped to meet airlines’ expectations. At the Farnborough Air Show in July, Airbus presented a new blueprint dubbed the A350 XWB – for “extra-wide body” – promising a roomier cabin, increased use of composite materials and large, Dreamliner-like windows.
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